It is easy to see that $f$ is uniformly continuous (basically by definition of a contraction). Now I'm trying to understand why this implies that $f$ extends uniquely to a continuous $\tilde{f}: \tilde{M} \to \tilde{M}$ where $\tilde M$ is the completion of M. Also, is $\tilde{f}$ a contraction as well? I think it is, but I'm having a hard time trying to justify it.

To answer your second question, now.
If there exists $K>0$ such that
$$
d(f(x),f(y))\leq Kd(x,y)
$$
for all $x, y\in M$, then the extension $\tilde{f}$ satisifies
$$
d(\tilde{f}(x),\tilde{f}(y))\leq Kd(x,y)
$$
for all $x,y\in\widetilde{M}$ by continuity and density of $M$ in $\widetilde{M}$.

Indeed, for all $x,y\in\widetilde{M}$ there exist sequences $x_n$, $y_n$ in $M$ which converge to $x$ and $y$ respectively, and for which the inequality is satisfied. Then passing to the limit and using the continuity of $f$, we get the same estimate for $\tilde{f}$.